How to open an account in the payment system?

AML (anti-money laundering) requirements and KYC (know your customer) banking rules are getting stricter every year. It becomes more difficult for a non-resident to open an account with a banking institution. A priori, banks consider almost every company that is not a resident and does not conduct economic activity in the country as a risky client.   In such circumstances, two courses of action are possible:

  • The first is, albeit with great difficulty, but finding a foreign bank that will agree to open an account. At the same time, you will probably have to put up with both overpriced tariffs and a limited set of services, and with the fact that the bank can change its policy regarding non-resident clients at any time and, as a result, freeze the account.
  • The second is to pay attention to payment systems. And this may turn out to be a fully justified decision.

Lawrange Law Firm provides a range of services for opening accounts for legal entities in banks and payment systems. We will find the best offers for your international business, taking into account the country of registration, the specifics of the activity, beneficiaries and contractors. We take on such complex issues as opening accounts for offshore and for High-Risk activities.

Opening an account in a payment system – general information

Payment Service Providers (PSP) is a fintech company that provides customers with non-cash money transfers (via online transactions). PSP clients can be both private and legal entities. Such companies carry out their activities on the basis of the Electronic Money Institution (EMI) license, as well as in accordance with the norms of the current legislation.   Benefits of payment systems for corporate clients:

  1. Remote account opening.
  2. Prompt consideration of the client’s application.
  3. Simplified customer identification procedure.
  4. Providing a personal IBAN.
  5. Manufacturability, convenient online banking, support service.
  6. Multi-currency, including access to payments in USD, EUR, GBP, UAH, RUB.
  7. Currency conversion at a favorable rate.
  8. Availability of SEPA and SWIFT payments.
  9. Loyalty to high-risk activities and classic offshore companies (Panama, Belize, Seychelles, British Virgin Islands).
  10. Optionally – processing services (merchant).
  11. Optionally a personal account manager.
  12. Optionally – accepting and converting cryptocurrencies: BTC, ETH, and so on.

The list of payment systems with which Lawrange JSC works:

  • UK : Wise, Bilderlings, Paystree, Emerald24, DynaPay, PayDo, LeoPay, PayOp
  • Netherlands : Bitsafe Payments
  • Cyprus : Unlimint (IT only)
  • Malta : Hawex PLC, Paymix
  • Czech Republic : Q-Pay
  • Lithuania : Paysera, Genome, PayApp UAB, GlobalnetInt, PayPugs, Vialet
  • Finland : Holvi
  • Hong Kong : Sterling Payment Services
  • USA : Payoneer (IT and e-commerce only)

*** Note: This list is not exhaustive. To get the latest information on the payment systems that our law firm works with, send a request for a commercial offer or for a personal consultation.   How long does it take to open an account in a payment system? 1 to 10 days. Can I order account opening across multiple PSPs? Yes. What is the cost of opening an account in the payment system? From EUR 500 to 1500.   *** Note: Some PSPs charge a separate activation fee.

How to open an account in a payment system for an offshore company?

Against the background of general complications with the opening of accounts for non-residents, it became almost impossible for offshore companies to gain access to European banking. Guided by the desire to cover the risks, banks require an activation deposit and the maintenance of a minimum balance in the account in the amount of hundreds of thousands or even millions of USD, EUR.   For your information! Even worse, an account opened some time ago or recently can be closed at any time. An example of this is the massive closure of non-resident accounts in Latvia since 2018. Bankers do not even explain the reasons for closing the account, or require a considerable amount of documents to accompany each transaction.      Unlike banks, payment systems offer more loyal requirements for customer identification, including when it comes to offshore. However, providing the documentation package and verification procedure to the client cannot be avoided. Among the reasons for this approach is the cooperation of payment systems with correspondent banks (intermediaries) that put forward their conditions.   Important!There are a lot of payment systems. At the same time, new and new ones enter the market every year. Some PSPs fail to comply with legal regulations and AML requirements. As a result, they fall under the sanctions of financial market regulators. AK Lawrange monitors such events and weeds out compromised payment systems. Customers who already do business with such PSPs are immediately alerted to potential issues. New accounts in such payment systems are not opened.   When opening an offshore account, you should take into account some of the nuances of the payment systems:

  • in most PSPs, you can only open an operating account, which is not intended for long-term storage of money;
  • standard limits are set on the transfer of funds (but representatives of payment systems are ready to make concessions and change these limits depending on the amount of transactions and the specifics of the client’s business);
  • as in banks, currency control of transactions is carried out in payment systems;
  • payment systems provide for two-factor identification via SMS and a mobile application – the highest level of protection, but without hardware passwords;
  • The PSP account may be managed personally by the director or by another person by power of attorney.

Since the process of opening an account in an offshore payment system has its own nuances, we recommend that clients start with a consultation. The choice of an acceptable PSP option from our current list will depend on the jurisdiction of the company, lines of business, turnover, counterparties, and so on.

How to open an account in a payment system in Europe (EU)?

By the end of 2020, all countries of the European Union brought their legislation in line with the new rules for working with payment accounts. Financial companies, including payment systems, have become more careful in identifying customers. Control over the functioning of payment systems and banking institutions in the EU is carried out by the very same state financial regulators (with reference to the country of registration of the PSP). Therefore, those trends that concern banks will inevitably affect payment systems.   For your information!When solving the issue of opening an account in a payment system of one of the European countries, it is necessary to take into account the specifics of the business. Only a transaction account can be opened with PSP. If the main part of the funds is constantly involved in the work of the company, then this option is acceptable and covers all needs. But if most of the funds are not involved in work for a long time, you should additionally resolve the issue of an account for storage.   Lawrange’s consultants recommend in such cases to open two accounts: the first – in the payment system for current work, carrying out payment transactions, the second – in a bank in Switzerland or another European state to store funds. In this case, you will have to comply with the minimum balance requirement, which can be withdrawn only when the account is closed .   The choice of jurisdiction for opening an account with PSP also depends on the specifics of the business. For example, Lithuanian payment systems are suitable for IT companies and e-commerce projects, and Great Britain for big business. At the same time, payment systems in the EU countries are distinguished by their reliability, which is explained by the stability of the economic and political environment.   To open an account in the EU payment system, you will have to collect a package of documentation and go through the verification procedure. Sometimes such verification is carried out via video communication in the messenger. However, as a result, the client of the payment system expects a number of preferences. Chief among them is the availability of SEPA payments.   *** Note: SEPA is a single euro payment area with no distinction between domestic and international payments.   The execution of transactions in SEPA provides a reduction in costs when working with European counterparties, since such payments are faster and cheaper than through SWIFT (the approximate cost of a payment order in SWIFT from € 20, in SEPA € 5, and sometimes free).

How to open an account in the payment system for High-Risk activities?

Today there are many payment systems, and their approaches to customer service are completely different. For clients engaged in high-risk activities (Forex, Gambling, Dating, Casino, ICO, Adult), payment systems are not always suitable, the names of which are heard by everyone involved in international business. These PSPs have attracted a sufficient number of customers, so they can afford to lose that customer, which entails excessive risks.

  • The client profile in such systems is streamlined, generalized. Any specific conditions can cause “red flags” in the security system, than provoke freezing, disconnection of the account.
  • Each new manager is asked for additional information and documentation. Preliminary compliance and onboarding do not play a decisive role in the system in such cases.
  • Any transaction can be problematic and lead to account blocking. Well-known payment systems can be compared to a conveyor belt. As an exception, it focuses on very large companies.

Important! Selection of a payment system for High-Risk activity is a task for professionals who continuously monitor the financial services market. Lawrange Law Firm supports partnership only with those payment systems that are ready to delve into the specifics of the client’s business, jointly search for risky places and, as far as possible, reduce the likelihood of problems.   When it comes to high-risk activities, in some cases only an account is available at a special rate, which is higher than for other clients. It all depends on the specific type of activity of the company and the reputation of the payment system.   For example, the following gradation applies:

  • +300 EUR per month for companies with risky activities, 
  • +1000 EUR per month for companies with risky activities registered in risky jurisdictions (classic offshore).

At the same time, we do not recommend considering savings on account maintenance as the main argument when choosing a payment system. A financial partner is selected for a long time. For High-Risk activities, it is better to spend a little more money at the start, when opening an account, than to deal with blocking and frozen transactions every month.

How to open an account in a payment system remotely?

A personal visit when opening an account in a payment system is almost never required. Sometimes the client verification procedure includes an interview via Skype, Zoom or other video communication program. If the client’s profile is clear, the payment system only requests a standard set of documents.   Attention! Corporate documents for opening an account should be provided in the form of good quality scanned copies. In addition to the standard list, additional documents may be requested.   The standard list of documents for opening a corporate account in the payment system includes:

  1. Certificate of Incorporation – confirmation of the registration of the company.
  2. Memorandum of association – Memorandum of Association.
  3. Articles of association – Articles of Association.
  4. Proof of address – confirmation of the address if it is not indicated in the registration documents.
  5. Authorized Signatory List – a list of signers, including authorized persons.
  6. Business plan – a business plan approved by the director.
  7. Good Stading or the Certifcate of incumbency – Certificate of Good Condition or Certificate of Authority (documents confirming the current status of the company).
  8. Register of members / shareholders – registers of the member / shareholders, another document in which you can see the structure of the company.
  9. PSC, register of members – register of beneficiaries.
  10. Documents of participants and directors (identification and proof of place of permanent residence, Utility).

*** Note: The list of documents varies depending on the payment system. The appropriate package of documents for filing with the application should be prepared only based on the requirements specified on the official website of the payment system or submitted by representatives of the payment system at the request of the client.   For your information! The procedure for verifying the identity of the user of the account in the payment system may provide for live video recording on the air:

  1. front and back of the identity card (residence card);
  2. the main page of the passport, the hard cover of the passport;
  3. Selfie: The face and shoulders must be clearly visible in the photo, no pictures in headdresses are allowed.

The procedure for such verification applies specifically to the user of the account, in particular – if it is not the beneficiary and not the head of the company. The personal data of the beneficiaries and managers are checked against the submitted scanned copies of documents.

How to open an account in a payment system for a Ukrainian company?

There are no formal restrictions on opening accounts by Ukrainians. Ukraine is not included in the “black lists” of countries with which international financial organizations refuse to work.   At the same time, it is difficult to choose the right payment system for further cooperation. In general, the option of opening a PSP account is beneficial for companies that are engaged in export-import activities, logistics, e-commerce, IT, consulting services, and so on. Gaming, dating, crypto, gaming should be separately highlighted, for which payment systems are practically no alternative solution.   Payment systems provide receiving and sending payments in different currencies and from different countries (to different countries). However, the list of payment system services varies. Lawrange’s consultants recommend using the followingpayment system selection criteria :

  • the presence or absence of the possibility of opening a merchant account (Merchant Account);

*** Note: JSC Lawrange offers the ability to connect payment processing for any business (including high-risk) as a separate service.

  • the cost of monthly service and transfers for non-residents;
  • providing a personal manager;
  • access to SEPA for payments in EUR.

The procedure for opening an account in the payment system for Ukrainians with the support of AK Lawrange provides for the following stages:

  1. Consultation with our specialist to clarify the needs and choose a payment system (it is possible to open a spare account in parallel with another PSP).
  2. Payment for services for opening a corporate account.
  3. Collection and submission of documents according to the list.
  4. Maintenance of the procedure for signing a cooperation agreement with the payment system (in case of approval of the application from the client).
  5. Gaining access to your personal account – account management tools.

If you need to quickly and with minimal effort open an operating account for a foreign offshore or onshore company, then the payment system is the best solution. Lawrange specialists will be able to simplify this task for you, as well as optimize the choice of a payment system for the specifics of your business.
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